I/O buffers are implemented in integrated circuit devices to transmit and receive data. Typically, whenever an I/O buffer switches from a high to a low state (e.g., when receiving or transmitting data), a current propagates from an on-board voltage supply, through a voltage rail (Vcc rail) to the buffer.
However, there is a parasitic inductance associated with trace routes from the on-board voltage supply to the I/O power rails on the integrated circuit. This inductance, if left unbalanced by a certain value of decoupling capacitance, results in a sharp drop in voltage on the Vcc rail at the event of current pull from the supply (di/dt, where i is current, and t is time, describes the rate of this pull), initiated by the buffer during data switching.
A large decoupling capacitance is traditionally added to the power delivery network to balance the parasitic inductance and prevent voltage droops. Such a capacitance is on-die and serves as storage for additional charge. Whenever the I/O buffer switches, the capacitance provides stored charge on the Vcc rail to compensate for any voltage droop.